Kathmandu, December 15:

January would be the perfect time to improve the export business and reduce the cost factor, according to Uday Raj Pandey, first vice-president of Garment Association Nepal (GAN). he added that there are three major aspects that should be geared to the upgrading of Nepali Readymade Garment (RMG) and export business as a whole - construction of a Garment Processing Zone (GPZ), lobbying for RMG and permission to keep labour on contract basis.

Trying to focus on the major tasks to be accomplished, Pandey said this January a new government would be installed in the United States and it would be the right time for intense

lobbying for Nepali RMG as the US this time is quite positive about granting duty free access both in a bilateral way and productwise.

Pandey said that Prime Minister Pushpa Kamal Dahal ‘Prachanda’, Finance Minister Dr Baburam Bhattarai and Minister for Foreign Affairs Upendra Yadav during their visit to the United Nations did great lobbying for Nepali RMG and that had a positive impact on the US government. He also urged for immediate approval of the bill regarding construction of GPZ under the Export Promotion Zone (EPZ) at Simra in Bara district.

“The bill regarding construction of the GPZ and EPZ is pending since six months. We wonder

why it is taking so long though there are more than a dozen industrialists representing the industrial sector in the Constituent Assembly,” said Pandey.

Talking about the minimum wage policy, Pandey said, “It’s not that we are unable to pay the labourers the minimum wage policy but the government should think about the garment industry. How can an industry provide the labor wage if it is not receiving any order due to global financial crisis?”

According to him, if only the government will grant permission to keep labour on contract basis, somehow the garment sector can manage costs. However, without any production granting the minimum wage and giving permanent job would be too difficult.

Talking about the global financial crisis and its impact on the export business, Pandey said, “As the purchasing power of people in the US has reduced due to the recession, right now we are trying to make prediction about the export business in January. As this is Christmas and New Year time, the retail sale figures during this festival will help us to calculate the sale that might happen during the coming months.”

An order normally takes about 120 days to reach buyers in the US, said Pandey adding that the recession had left a negative impact on the export business. “We are facing difficulty fix a price quote for garments as the US dollar is unstable. We might face loss,” said Pandey.

He said the recession had cut the purchase order to half. Buyers now have also started ordering on credit basis, adding, “The situation in the garment export business is unpredictable until February.” In November, a 41 per cent decrease in the export of RMG to the US was observed. The value of RMG exported to the US in November was to the tune of $421,850.90.